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Help! People in the know...would a leasehold property put you off?

(55 Posts)
JustWhat Mon 25-Sep-17 17:09:44

Hi,

Just (literally!) had a call to say our offer on a house has been accepted...very exciting!

However, whilst researching nearby properties to negotiate the price, we saw they were all leasehold and when we asked it turns out this one is also. There are apparently 940 years remaining on the lease and there is no ground rent to pay (odd?!)

Would this put you off?

If so, for what reason?

Thank you!

Dizzywizz Mon 25-Sep-17 17:11:13

Would put me off as I would feel I don't 'own' the property fully (well, you wouldn't) and I would want control in any works etc and management.

GrockleBocs Mon 25-Sep-17 17:15:26

Yes it would put me off.

ChangedToday Mon 25-Sep-17 17:16:48

Yes, definitely put us off.

GrockleBocs Mon 25-Sep-17 17:18:28

Sorry reasons too. Worry over increases to the annual charges. Some of the newer leasehold houses have the potential to increase annual payments by a big amount.

JustWhat Mon 25-Sep-17 17:21:05

There is no annual payment according to the estate agent. I don’t quite understand this either...confused

Josiah Mon 25-Sep-17 17:26:13

Yes. I looked at a property back in April that was a large house and was surprised when to see it was leasehold. It put me off.

The land is owned by the Dukeof Beaufort. However, I see that he has now died in August.

artisancraftbeer Mon 25-Sep-17 17:27:44

Have a look at whether there are fees payable to the landlord for alterations and sales. Some landlords are charging a fortune for minor changes.

SpongeBobJudgeyPants Mon 25-Sep-17 17:28:16

Yes, just heard bad stuff about it. Probably going to affect selling on too. Though I appreciate some areas have more leasehold property than freehold. Round these parts would be v unusual to be leasehold.

LBOCS2 Mon 25-Sep-17 17:32:02

I work in this industry and the honest answer to it is that I would need to read the lease.

You're more protected as a leaseholder than you are with a FH property on a private estate, as the Landlord and Tenant Act(s) give you more rights and obligations to your freeholder. So it really depends what your lease throws up - it could be that it's just a mechanism by which the house is sold and there's minimal ground rent to be paid. OR it could be a full comprehensive lease with estate charges, covenants regarding noise, what colour you're allowed to paint your front door/do to your front garden, if you can keep pets etc.

So the short answer is read the lease smile

ladybirdsarelovely33 Mon 25-Sep-17 17:32:43

Honestly I would not do it. The current freeholders could start you paying ground rent and also they could sell the freehold interest to another company. You don't know what they could do on the estate (presuming it is an estate) one day. You do have some say as leaseholders but not as much as you think.

JustWhat Mon 25-Sep-17 17:36:41

LBOCS2 Thank you for that. Can I ask at what point we can ask to see the lease? Is that something we can do now before we go any further?

I do know that the house has just been redone from to mo to bottom including total conversion of cellars etc and according to vendor and estate agent no liaising with landlord nor any payment has been necessary.

It’s a bit of a minefield!

chickenowner Mon 25-Sep-17 17:38:38

Don't do it!

Etymology23 Mon 25-Sep-17 17:41:45

agree with LBOCS , hope you get hold of the lease ok!

JustWhat Mon 25-Sep-17 17:42:49

For what reason please chickenowner?

PaintingByNumbers Mon 25-Sep-17 17:42:51

Whats the norm for your area? Here, its totally normal, lease is about a quid a year, no clauses, you'd be mad to let it put you off. Ask to see the lease

LBOCS2 Mon 25-Sep-17 17:43:20

You can get it directly from the Land Registry - it'll cost you about a fiver. Hopefully it will be electronic and they can just email it to you but you may have to wait for it to be sent as a hard copy.

AnnieOH1 Mon 25-Sep-17 17:49:25

Wow - modern leases have done a number on so many of you. There are entire cities in england with primarily leasehold homes that have been in existence 100 or so years with another 900 years to go. Most often they're a peppercorn rents and aren't worth buying the freehold by virtue of the length of time left and actual cost. I've seen plenty where people have paid 20 years up front for the sake of maybe £20 or less.

If its a modern lease then for me it would be a no go, too many have rent increases that are eyewatering. The worst I have personally seen was a new build estate in Sheffield, not in a fantastic area just okay circa 2004. The starting ground rent was £300 per property (not including service charge) with an effective doubling of the same every five years.

Leasehold with service charge is preferable over freehold with service charge, but few estate agents and builders are that forthcoming initially. People end up £££s down in fees and then find the solicitors leasehold report shows the property comes with ridiculous costs.

If its an older property you should be able to obtain a copy of the lease from land registry (provided it has sold this millennium - can't recall exact year now) for a few ££s which will contain what you need to know.

pattimayonnaise Mon 25-Sep-17 17:51:20

How old is the house and where are you? I’m leasehold in my new house and we were before too. It’s extremely common where I live (Yorkshire) and it’s never caused any problems. You are eligible to buy the freehold after two years and if there is no ground rent then I can’t see why the leaseholder would try and stop you.
Read the lease and check the conditions, sometimes you have to get permission from the leaseholder to make modifications and extend etc. - but mine has been extended multiple times with no issue and no payment required.

Fekko Mon 25-Sep-17 17:53:32

Perfectly normal round here (London). We are all just borrowing our properties! There must be some service charge or land rent?

titchy Mon 25-Sep-17 17:55:57

Leaseholds are very often peppercorn ground rent and a hangover from the olde dayes when the lord of the manor owned all the land - as such nothing whatsoever to worry about. Very common in the north of England.

A leasehold flat on the other hand - again very common and often the only way to own a flat.

Some leasehold houses can have iffy free holders, though this is relatively unusual.

To sum up - shouldn't put you off no. But do check the lease.

furlinedsheepskinjacket Mon 25-Sep-17 17:56:07

i had a house once with a 900 yr lease - no rent as it was peppercorn

never had any trouble with it

PickleFish Mon 25-Sep-17 18:01:01

All the new build flats and houses round here are leasehold. And they're all that anyone who wants shared-ownership can get, as that's only available in this area on the new-build stuff. and given the prices, a lot of people can only barely afford shared ownership. So it's really not a question of choice! I had to, because that's all that is possible. Not what I might have wanted, but there you go. There's a lease that's general for the shared ownership and for the leasehold stuff together, as far as I know, and it does have restrictions on what you are allowed to do and whether you can keep pets etc.

But I think that's true of most flats, and many houses on estates.

JustWhat Mon 25-Sep-17 18:05:09

Some really helpful replies thank you! Can you explain what you mean by ‘peppercorn’ please, in layman’s terms?

Thank you so much

Laska5772 Mon 25-Sep-17 18:05:59

OP make sure you look at this article on leasehold property first .. if its a new or recent build I really wouldnt right now..

A secondhand property will not be exempt after this rule change even if you have just bought it ..and lots of people have been really caught out .

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